Tommy Hilfiger Corporation, acting upon the recommendation of a special committee of its independent directors, yesterday announced that it has signed a definitive agreement to acquire all the outstanding shares of T.H. International N.V, the owner of its European licensee, for $200m in cash.

The principal operating subsidiary of T.H. International is Tommy Hilfiger Europe B.V. (together with its subsidiaries, "Tommy Europe''), which is headquartered in Amsterdam.

Tommy Europe markets and distributes Tommy Hilfiger men's, women's and children's sportswear and jeanswear in over 20 countries throughout Europe and the Middle East under license from the company, currently reaching approximately 3,000 points of distribution.

For the fiscal year ended March 31, 2001, Tommy Europe reported revenues of Euro 119m. It is expected to achieve revenues of approximately Euro 175m in the full fiscal year ending March 31, 2002, an increase of approximately 47 per cent.

Under the terms of the transaction, the company will also assume approximately $30m in short-term debt of Tommy Europe. The transaction is being funded using available cash and is expected to add an aggregate of four to six cents to the company's earnings per share in the last three quarters of the current fiscal year ending March 31, 2002. The acquisition is expected to be completed in July 2001.

New growth opportunities
"This acquisition combines our fastest growing and largest geographic licensee with our North American business and adds a new and natural growth vehicle for the years to come, as the Tommy Hilfiger brand continues its development as a global lifestyle brand,'' commented Silas Chou, co-chairman of the company.

Tommy Europe has built a strong platform to support future growth along with a seasoned management team led by Fred Gehring, chief executive officer and president. The management team, which is expected to remain in place, has extensive experience in key areas of the European apparel industry.

Joel Horowitz, chief executive officer of Tommy Hilfiger Corporation, said: "We have been carefully watching Tommy Europe grow from a start-up venture in 1997 to a well-run and thriving premium apparel company built on sustained interest in and demand for the Tommy Hilfiger brand in multiple product categories across many countries.

"This is clearly the right time for us to maximise the growth opportunities of Tommy Europe for our shareholders by bringing it in-house. Our goal is to leverage its existing multi-channel and pan-European operating platform to further expand across Europe."